Marcellus Drilling News

Energy Services | Energy Transfer Partners | Industrywide Issues | Litigation | M&A | Williams

Court Says was OK for ETE to Scuttle $33B Williams Takeover Deal
March 24, 2017March 24, 2017

Last year an elaborate midstream drama unfolded before our very eyes. Energy Transfer Equity (ETE) pushed and prodded and poked and cajoled and insisted, and finally with the help of an inside corporate raider, forced Williams to agree to a buyout/merger (see Williams Accepts ETE’s “Indecent Proposal” – Price Went Down $10B). Then the bottom dropped out of the price of natural gas and drillers scaled back drilling and consequently midstream (i.e. pipeline) companies like ETE and Williams got pinched. And ETE got cold feet (see ETE Wants Out of Williams Merger/Takeover, Offering $2B Breakup Fee). Williams said “not so fast, you wanted us, you’ll be taking us” and consequently sued ETE to force the merger to happen (see Merger Turns Sour: Williams Sues ETE/CEO Kelcy Warren). However, in the end, the merger never happened (see Dead as a Doornail: ETE Terminates Merger with Williams). Since breaking the agreement, Williams and ETE have been in court battling over lots of things, including a $1.5 billion breakup fee. Earlier this week an appeals court ruled ETE was within its rights to break the deal. What does that mean about paying Williams a breakup fee?…
Read More “Court Says was OK for ETE to Scuttle $33B Williams Takeover Deal”
Crime | Energy Services | Energy Transfer Partners | Industrywide Issues | Pipelines

Eco-Terrorists Burn Holes in Dakota Access Pipeline in 2 States
March 24, 2017March 31, 2017

Dakota Access Pipeline “peaceful” protesters

Eco-terrorists are responsible for using a blowtorch to burn holes in two different above-ground valve sites for the newly completed Dakota Access Pipeline. One of the sites was in North Dakota. The other in Iowa. It was a criminal act of terrorism meant to cause an oil spill or worse. It is the kind of thing we have (unfortunately) come to expect from twisted, evil eco-jihadists in their screwed-up mission to rid the planet of fossil fuels. Here’s what we could find out about these terrorist acts…
Read More “Eco-Terrorists Burn Holes in Dakota Access Pipeline in 2 States”
Best of the Rest

Marcellus & Utica Shale Story Links: Fri, Mar 24, 2017
March 24, 2017March 24, 2017

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: 7 permits issued last week in OH Utica; PA gov’s mixed signals on shale gas; US shale drillers leaving thousands of oil wells unfinished; State Dept. to approve Keystone XL pipeline; Chesapeake Energy’s liquidity matters; Trump plans to reverse Obama climate change policy; China’s LNG imports on the rise; and more!
Read More “Marcellus & Utica Shale Story Links: Fri, Mar 24, 2017”
Electrical Generation | Industrywide Issues | Monroe County | Ohio

Gas-Fired Plant (& Cracker?) Coming to Center Port Terminal in OH
March 23, 2017March 23, 2017

[NOTE: In the original version of this post, MDN incorrectly referred to the name as Center Point Terminal. It is, in fact, Center Port Terminal. Sorry!] One of MDN’s sharp subscribers emailed us with an exciting tip. On March 27 a public meeting will be held in Woodsfield, Ohio (Monroe County) about building a 485 megawatt gas-fired power plant–to be built on twenty acres of the 200 acre former Ormet site, now known as Center Port Terminal. That much we have been able to confirm. Our tipster also speculated this new power plant may be used to provide electricity to an ethane cracker. We have not, so far, been able to verify the cracker rumor. Here is what we do, and don’t, know about this new power plant project coming in Monroe County…
Read More “Gas-Fired Plant (& Cracker?) Coming to Center Port Terminal in OH”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Litigation | Pennsylvania | Statewide PA

Fed Judge Dismisses Dela. Riverkeeper Lawsuit Against FERC
March 23, 2017March 23, 2017

It took a whole year, but a federal court has just thrown out a frivolous lawsuit filed by Maya van Rossum, THE Delaware Riverkeeper, which attempted to defund the Federal Energy Regulatory Commission (FERC). Last year MDN reported on the lawsuit filed by Maya and company–a lawsuit which aimed to shut down the entire agency by defunding it (see THE Delaware Riverkeeper Sues FERC, Tries to Close it Down). Delaware Riverkeeper filed their lawsuit against FERC in U.S. District Court for the District of Columbia–one of the most liberal jurisdictions in the country. The lawsuit claimed FERC can’t objectively make decisions about projects like the Penn East Pipeline (running from the Wilkes-Barre area to New Jersey) because FERC derives some of its operating revenue from the projects it either approves or does not approve. Liberal U.S. District Justice Tanya Chutkan found Riverkeeper’s arguments don’t hold water (pun intended). In her 20-page opinion (copy below), Chutkan doesn’t buy Maya’s BS line that FERC is hopelessly biased. Although Maya tried to spin the bad news as good (because Riverkeeper achieved “standing” in the case), the decision is, in fact, a crushing blow for Maya and her merry band of eco-nuts…
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Industrywide Issues | Lease & Royalty Payments | Litigation | Ohio | Statewide OH

OH Court Says Grandkids Can Claim Mineral Ownership Under DMA
March 23, 2017March 23, 2017

MDN has previously highlighted the importance of last year’s Ohio Supreme Court decision with regard to the Ohio Dormant Mineral Act (DMA). In September 2016 the OH Supreme Court ruled in three DMA cases, saying all of the other cases come under those three (see Important: OH Supreme Court Finally Rules on Dormant Mineral Act). Following that ruling, we brought you insights on what it means from international law firm Jones Day (see One More Look at Important OH Supreme Court DMA Decision). We later ran a copy of an analysis done by attorney David Wigham, who said, “[T]he landscape regarding title and ownership to mineral interests in Ohio has significantly changed” (see Expert Says OH DMA Decision “Significantly Changed” Mineral Rights). The ramifications of the Supreme Court’s decision continues–and various aspects of the now-settled law are still, well, getting settled. Under the DMA if a surface landowner advertises his or her intent to reclaim mineral rights (when the rights have been dormant for period of years), the rights owners have a certain amount of time to respond to reassert their ownership. But what if the original rights owners are now dead. Can their heirs, as in grandchildren, claim those rights? Under a case just decided in Ohio’s Seventh District Court of Appeals, the answer to that would be, “Yes”…
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Energy Services | Industrywide Issues | Pennsylvania | Pipelines | Statewide PA | Williams

Williams Launches PA Media Campaign to Promote Atlantic Sunrise
March 23, 2017March 23, 2017

Williams is in the years-long (and almost impossible) process of building the Atlantic Sunrise Pipeline project–a $3 billion, 198-mile pipeline running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from PA with the Williams’ Transco pipeline in southern Lancaster County. On Feb. 3, 2017, the Federal Energy Regulatory Commission (FERC) gave its final approval for the project (see FERC Approves Atlantic Sunrise Pipeline! Cabot Grabs More Capacity). From FERC’s perspective, Atlantic Sunrise can start the bulldozers any time–except the Pennsylvania Dept. of Environmental Protection (DEP) has not yet granted some necessary permits. As we reported earlier this month, Williams is keeping up the gentle pressure (see Williams Keeps Pressure on PA DEP to Issue Atlantic Sunrise Permits). That pressure continues. Williams has just launched an “expanded” media campaign, complete with on-air commercials, which aim to “educate the community about these benefits and the importance of designing, constructing and operating critical natural gas infrastructure projects in Pennsylvania.” The new media effort is also meant to ratchet up the pressure on the DEP another notch…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | PennEast Pipeline | Pipelines

NJ’s Lib Dem Senators Bash PennEast Pipe Over Arsenic “Concerns”
March 23, 2017March 23, 2017

New Jersey’s reliably lefty Democrat U.S. Senators, Cory Booker and Robert Menendez, played to their fringe, unhinged base of eco-nut supporters by sending a letter to the Federal Energy Regulatory Commission claiming the PennEast Pipeline project, due to run through a small portion of NJ, “may” cause problems with arsenic–as in releasing the toxic substance into drinking water supplies from digging trenches and erosion. It is a flat out, bogus, BS claim–and they know it. But they were put up to the letter-writing task by some of their Big Green donors, including ReThink Energy NJ and New Jersey Conservation Foundation. It’s nothing new that campaign contributions (i.e. bribes) buy you access. PennEast has responded that the issue has already been addressed in their application with FERC–there is a plan to monitor and protect against any potential disturbance of the ground that would cause arsenic levels to increase. That’s what responsible adults do. They respond in an adult-like, responsible manner. Unlike the other side…
Read More “NJ’s Lib Dem Senators Bash PennEast Pipe Over Arsenic “Concerns””
Energy Companies | EnerVest

EnerVest Selling 1,100 Wells, 361K Acres in Appalachia
March 23, 2017March 23, 2017

In September 2012 EV Energy Partners/EnerVest put 539,000 Ohio Utica Shale acres on the auction block. It didn’t sell. In 2013 they announced they would begin selling sections piecemeal, a strategy that has netted a few sales since then (see EnerVest Strategy: Sell Utica, Drill Vertical, Expand Midstream). However, EnerVest still retains a lot of Utica acreage. According to the NGI’s Shale Play Factbook, EnerVest owns 903,000 acres, slightly less than powerhouse Chesapeake Energy. In 2014, EnerVest made another run at trying to figure out how to get oil out of their acreage (see Utica Shale Oil Far from Dead – EnerVest, EQT Try Again). In September 2015, EV Energy Partners, a subsidiary of EnerVest, purchased property from the mothership EnerVest in the Appalachian Basin, San Juan Basin, Michigan and Austin Chalk for $259 million (see EV Energy Partners Buys $259M in Wells/Leases from Parent EnerVest). And last year, in 2016, we brought you a story about EnerVest experimenting with drilling horizontal wells in the Ohio Clinton sandstone layer (see EnerVest Likes Clinton Sandstone “Utica-lite” Oil Wells in OH). The company remains active. MDN friends at Kallanish Energy have some new news about EnerVest. ~~In yet another “drop down” deal,~~ EnerVest is selling 360,621 acres of leases and 1,100 wells in the Appalachian Basin ~~to EnerVest Operating, yet another subsidiary~~. [NOTE: MDN read the news wrong on this. EnerVest previously bought the leases/wells and now THOSE leases/wells are for sale–to someone else. This is not a drop down deal. Apologies to our friends at Kallanish!] The land and wells cover West Virginia, Virginia and Kentucky. We suspect that most, if not all, of the wells are conventional (non-shale) wells. However, the possibility remains that some of the wells are shale wells. And certainly the land has potential for horizontal shale drilling, which is why we’re interested in this bit of news…
Read More “EnerVest Selling 1,100 Wells, 361K Acres in Appalachia”
Ascent Resources | Energy Companies

Ascent Resources Continues Aubrey’s Borrowing Ways: $1.5B in IOUs
March 23, 2017March 23, 2017

Feed me, feed me! Let’s be honest. Aubrey McClendon (God rest his soul) almost bankrupted Chesapeake Energy. The company’s stock price took a nose dive when the price of oil and natural gas went over a cliff. Aubrey had the company leveraged to the eyeballs and it teetered on the edge of bankruptcy until last year, when CEO Doug “the ax” Lawler claimed the company was out of the woods. We won’t recount our disdain for how Aubrey was ejected from the company he founded (by evil corporate raider Carl Ichan). After leaving Chesapeake, Aubrey started a new company–American Energy Partners (AEP). That company, AEP, set up a number of subsidiary companies to target different shale plays. One of the largest was aimed squarely at the Ohio Utica. That company later left the AEP fold (under pressure from investors) and became an independent company, renaming itself as Ascent Resources. However, Ascent, just like pappa Aubrey, went on a money-raising binge. In March 2016 Ascent floated 2.2 billion common units (think shares of stock) to raise $500 million (see Ascent Resources Sells More of Company to Pay Down Debt). Ascent planned to use that money to pay off existing notes, or IOUs. In August 2016, Ascent flirted with bankruptcy but pulled its bacon out of the fire by restructuring its debt (see Ascent Resources Talking to Creditors to Restructure $1.2B Debt). In November last year Ascent sold another 3.5 billion common units, hoping to raise $787 million to (yes) pay down outstanding debt (see Ascent Resources Sells Another 3.5 Billion Units for $787 Million). Here we are four months later, and Ascent is back, floating (yep)–new debt. New IOUs. Ascent pushed out an announcement yesterday that the company is offering $1.5 billion of senior unsecured notes. Unsecured means if they go belly up, investors in those notes won’t see a penny…
Read More “Ascent Resources Continues Aubrey’s Borrowing Ways: $1.5B in IOUs”
Industrywide Issues | Ohio | Regulation | Statewide OH

OOGA Joins Fight Against Obama BLM Venting-Flaring Rules
March 23, 2017March 23, 2017

In January 2016, the Obama Dept. of Interior posted a new rule that will make it all but impossible for oil and gas drillers to drill on federal lands (see Obama’s Interior Dept. Sneaks in New Rule to Limit Methane). The new 298-page rule requires companies to use expensive equipment to capture every last molecule of methane, the stuff these companies already capture so they can sell it, to prevent any “fugitive” methane from escaping into the atmosphere where it contributes to mythical global warming. Obama has also hiked the price drillers will pay to drill on federal lands. The aim is, of course, to shut down drilling on all federal lands. The “venting and flaring rule,” as it’s known, was adopted by the outgoing Obamadroids in the closing days of Obama’s ignominious administration. The new rule was due to be rolled back by a vote in the new Republican-controlled Senate. But that hasn’t happened–yet. Timid Republicans are afraid that rolling back the horrible rule will lose them votes with green radicals (not that greens will ever vote for them anyway). There is a full court press to get the Senate to vote. The Ohio Oil & Gas Association (OOGA), representing hundreds of Ohio drillers, has joined the effort and is trying to convince Ohio Republican Sen. Rob Portman to support the repeal of the BLM rule…
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Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Mar 23, 2017
March 23, 2017March 23, 2017

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Maryland Senate panel OKs ban on fracking; NY AG’s private email history raises questions about anti-Exxon campaign; Ohio’s ad valorem tax positively impacts Guernsey County; Solebury Twp, PA takes steps to oppose PennEast Pipe; MarkWest establishes scholarship at WCCF; VA conservation agency puts new restrictions on Atlantic Coast Pipe; ICE to start trading first US LNG futures contract; Rex Tillerson says his wife convinced him to take Sec State job; and more!
Read More “Marcellus & Utica Shale Story Links: Thu, Mar 23, 2017”
Economic Impact | Ethane | Industrywide Issues | Pennsylvania | Processing Plants | Research | Statewide PA

PA Study Finds Marcellus/Utica Can Support 4 More Ethane Crackers
March 22, 2017March 22, 2017

Back in January MDN reported that Denise Brinley, a special assistant to the Secretary of the state Department of Community and Economic Development, spilled the beans on an upcoming report PA had commissioned. Brinley said the report would be released “in the coming weeks” and it would show that Pennsylvania can easily handle another two ethane cracker plants (aside from the already under construction Shell cracker), and that Ohio or West Virginia could also handle another two cracker plants (see PA Report Says Marcellus/Utica Can Support Up to 4 More Crackers). In other words, there’s enough ethane in the Marcellus/Utica to support a minimum of five ethane cracker plants. It’s been more than a few weeks, but finally the report is out. On Monday, Team Pennsylvania Foundation co-chairs Gov. Tom Wolf and Stephen Tang, President and CEO of Philadelphia’s University City Science Center, released “Prospects to Enhance Pennsylvania’s Opportunities in Petrochemical Manufacturing” (full copy below). The report comes from a comprehensive study conducted by powerhouse oil & gas consulting firm IHS Markit. According to the study, natural gas from the Marcellus/Utica accounted for 25% of all natural gas produced in the U.S. in 2015, and is expected to account for more than 40% by 2030. Wow! Additionally, 40% of Marcellus/Utica natural gas produced is rich in natural gas liquids (NGLs). Most of the NGLs produced (70%) are ethane and propane, used by petrochemical plants and plastics manufacturers. You can see why our region can handle a lot of crackers. Here’s the announcement and a copy of the full (exciting) report…
Read More “PA Study Finds Marcellus/Utica Can Support 4 More Ethane Crackers”
Dominion Energy | Energy Services | Industrywide Issues | New York | Pipelines | Regulation | Statewide NY

FERC Green Lights Construction of Dominion Project in Upstate NY
March 22, 2017March 22, 2017

In June 2014, MDN told you about the Dominion New Market Project–a project that will build two new compressor plants and upgrade one other compressor station in upstate New York–to help flow more abundant, cheap and clean-burning Marcellus Shale gas from Pennsylvania (and beyond) into the northeast (see Dominion Asks FERC for New Compressors in Upstate NY, WV). The project is projected to cost $159 million and provide 112,000 dekatherms per day (Dth/d) of extra natural gas capacity along ~200 miles of existing Dominion pipeline across upstate New York. The existing Dominion pipeline runs through the Horseheads, Ithaca, Syracuse and Albany areas. In March 2015 MDN friend Andy Leahy wrote about the pitched battle antis waged against the project (see NY Antis Flood FERC in Fight Against Dominion’s New Market Project). The antis were unsuccessful. The Federal Energy Regulatory Commission (FERC) approved Dominion’s New Market Project in October 2015 (see FERC Approves Expansion of Dominion Pipeline in Upstate NY). And then a REAL miracle happened. The corrupt New York Dept. of Environmental Conservation (DEC) approved the New Market compressor stations on Dec. 23, 2016 (see Miracle! NY DEC Approves Dominion’s New Compressor Stations). Barbara Lifton, an eco-left Democrat from Ithaca who serves in the New York Assembly, recently tried to stop the project from proceeding by sending letters to both FERC and the DEC, hoping she could (ab)use her position to pressure one or the other (or both) to delay the project, which is the antis’ first step in killing a project (see NY State Legislator Tries to Derail Dominion New Market Project). We’re delighted to report she failed. Last Friday FERC sent a letter to Dominion to let them know, now more than three years after filing, they can start the bulldozers and begin construction. In Communist NY! Who woulda thunk?!…
Read More “FERC Green Lights Construction of Dominion Project in Upstate NY”
Buckeye Brine | Energy Services | Industrywide Issues | Ohio | Research | Statewide OH | Washington County (OH) | Wastewater

MDN Exclusive: 2016 Ohio Wastewater Disposal Market Report
March 22, 2017March 22, 2017

We are super excited to bring you an exclusive report that has just been released by MDN subscriber Andrew Kilgore. The report is titled “2016 Ohio Wastewater Disposal Market Report” (full copy below) and it details the wastewater injection well industry in Ohio. Andrew has spent most of his career working in the Appalachian Basin. He is an alumnus of BlueJack Energy (see Wastewater Co. BlueJack Energy Launches with $100M Investment), EnLink Midstream, and co-founder of UM Resources. Andrew authored the report and offered to let MDN be the first media outlet to release it. We thank him! The report finds that in 2016 the total amount of wastewater disposed of in Ohio was 29.4 million barrels–almost 2 million fewer barrels disposed of compared to 2015. The majority of the decline was from wastewater from out-of-state slowing down (i.e. from Pennsylvania and West Virginia). The report outlines a number of reasons for the decline in wastewater volume disposed in OH, with the primary reason being less drilling due to the low commodity price of natural gas. A few quick facts from the report: Washington County, OH saw the most volume of wastewater disposed. Buckeye Brine processed the most wastewater volume. Here’s the full report…
Read More “MDN Exclusive: 2016 Ohio Wastewater Disposal Market Report”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Pipelines | Statewide PA

Potential FERC Com. Powleson Calls Anti-Fossil Fuelers “Jihadists”
March 22, 2017March 22, 2017

Rob Powelson

We can’t speak highly enough of Rob Powelson, member of the Pennsylvania Public Utility Commission (PUC) and currently the president of the National Association of Regulatory Utility Commissioners (NARUC). As we recently reported, Powelson is one of three names being rumored as a nominee to the Federal Energy Regulatory Commission (see Names Mentioned for 3rd FERC Post, Incl. PA’s Powelson). It can’t happen soon enough! Yesterday Rob spoke at the Upstream PA conference in State College. He didn’t beat around the bush. In a very frank talk, Rob said equated fossil fuel nutters with Islamic terrorists when he said, “The jihad has begun…At the Federal Energy Regulatory Commission groups actually show up at commissioners’ homes to make sure we don’t get this gas to market. How irresponsible is that?” So true. These anti wackos have more in common with anti-American terrorists than they do with common, decent, ordinary Americans. They are so hyped-up and amped-up on global warming hysteria, they’re willing to use extreme tactics–even violence–to force their will on everyone else. It’s about time we started calling it like it is, and that’s just what Rob did yesterday. He also called Maryland Gov. Larry Hogan (who just announced his support for a permanent frack ban) an ignoramus, in so many words…
Read More “Potential FERC Com. Powleson Calls Anti-Fossil Fuelers “Jihadists””